Option A: Rent ($1600) + camry ($0); Option B: Rent ($600) + Tesla ($900)

[safari]

I read the following post on another forum that I frequent and felt compelled to repost it here. Enjoy!

So I'm in a situation here. I currently live in a really good place and pay only $600/month to rent a room in a nice condo (2 others live here; but they are consultants and i never see them bc they travel alot). Got a new job, however, and commute is about 35 miles each way. So I am thinking about buying an electric car (possibly a Tesla, i3, or another one) just so I can use the carpool lane and get to work faster. Currently I drive a Camry. I think i will have to pay $900/month for the payment and increase in insurance costs.

Does my logic make sense? If I move closer to work, I am looking at minimum of 1600-2000/month for a 1 bedroom place. I know my comparison is not truly apples-to-apples in terms of scenario A v scenario B, but in terms of just money, does Option B sound justifiable?

My logic is: yes, I would put down $15k or so as down payment, but the residual value of the car will be worth at least 15k anyway in a few years. So the fact the it is a depreciating asset is offset by the fact that paying rent is worse than investing in something that depreciates so rapidly bc you don't own any assets in that scenario at all.

Thoughts?

[Tabs]

Oh man, I just loooooove Teslas! Love them! However, they are just so expensive that I would not consider them. Because cars are a depreciating item, I think any car above maybe $20k or $25k is asking for too much.

And yes, there are EVs and hybrids that are under $20k, gently used. Take a look at the Nissan Leaf, for example, where from 2013 on up have a range of up to 100 miles. If OP has any range anxiety about it, see if he or she can't find a way to keep it plugged in and charging while at work.

Otherwise, a Prius is not a bad idea at all. Yes, it's a hybrid, but the gas mileage is amazingly good, and is the only current eco car on the market with a proven track record for utter reliability. Given the inherent complexity found in hybrid engines, that's a remarkable feat.

If OP still wants a Tesla, they've announced that they are trying to produce a model 3 that will have the same 200 mile range as previous models, but come under $30k. I don't think that will happen until 2017 at the very least.

Chevy is trying to beat Tesla at their own game by producing the Bolt, which offers the same price and range as the Tesla model 3, and is also slated to come out in around 2017.

Speaking of Chevy, they still offer the surprisingly good EV known as the Volt. I am seriously, realistically considering this one. Yes, the electric range is only 40 miles tops, but it has a gas generator backup that extends the range by another 300+ miles while giving about the same fuel economy as a Toyota Corolla. Also, if OP has a way to keep it plugged while at work, he could very well drive the entire round trip on nothing but electricity!

While I'm here, can I just say that a 35 mile commute is atrocious? I get that he's saving on rent but wow. Just wow.

[bjl584]

I vote Tesla!! Just make sure you buy the bigger model so you can live in it.

[Tabs]

Hahaha, have you seen the Model X with rear gull wings? Going to be the sexiest vandweller around.

[ua_guy]

If you want to own a hot car, that's one thing. If you're thinking you'll save some gas money by buying a $60k electric car, that's another thing--and the numbers probably don't support the decision at current gas prices.

Cars should be looked at as pure expenses. Until you're on top of things like topping off your emergency fund, being on track for retirement savings, and accomplishing any other goals you'd put before buying a car, I'd postpone buying an expensive car.

[corn18]

Just priced a Tesla S with the ludicrous speed package (reminds me of Space Balls). $142,500 but I would get a $7,500 tax credit. If I finance it for 22 years, I could afford it, right?

[Leo]

Is 35 miles pure highway without heavy traffic?
Moving closer to work means what? 5 mins commute?

[feh]

If you want to own a hot car, that's one thing. If you're thinking you'll save some gas money by buying a $60k electric car, that's another thing--and the numbers probably don't support the decision at current gas prices.

+1 Sounds like somebody is looking for an excuse to buy a Tesla.

Lots of other EV and hybrid options that don't cost an arm and a leg.

[Like2Plan]

Just priced a Tesla S with the ludicrous speed package (reminds me of Space Balls). $142,500 but I would get a $7,500 tax credit. If I finance it for 22 years, I could afford it, right?

Dang, that's expensive! How much would it be without the speed package?

[corn18]

Dang, that's expensive! How much would it be without the speed package?

The cheapest you could go is $70k but you get a cool $7500 back from Uncle Sam. Good deal, right? It is a beautiful car. Between that, the F-Type Jag and the Astin Martin DB9, it's tough figuring out what to waste my money on. BTW, you SA folks have ruined me. I used to think I could afford one of those cars. Now I'm happy with my 7 year old truck. Between SA and The Millionaire Next Door, I might just have a chance to retire before I'm 70.

[tiffany85]

Hahaha, have you seen the Model X with rear gull wings? Going to be the sexiest vandweller around.

They are falcon wing doors. Get it right. And you call yourself a Tesla fan.

I too LOVE those cars. I got a ride in one a few years ago and OMG the experience was unlike anything I've ever felt. You could pass people with the narrowest window of opportunity. What a REVOLUTIONARY car in a world full of evolutionary garbage. Besides safety features and infotainment systems, cars really hadn't changed much until Elon Musk got on the scene.

I loathe commutes as well. I think the OP should bike to work. Or walk.